Consumer spending and personal incomes both weak WASHINGTON (AP) â¿¿ Consumers did not boost their spending in June and their incomes failed to increase, further evidence that the economic recovery slowed in the spring. And Americans saved at the highest rate in nearly a year. Personal spending was unchanged in June, the Commerce Department reported Tuesday. It was the third straight month of lackluster consumer demand. Incomes were also flat, the weakest showing in nine months. The lack of growth for spending and incomes shows the economy ended the second quarter on a weak note. Many analysts believe growth will slow further in the second half of the year as high unemployment, shaky consumer confidence and renewed troubles in housing weigh on the year-old economic recovery. ___ Factory orders drop for second straight month WASHINGTON (AP) â¿¿ Factory orders fell in June for the second straight month due to lower demand for steel, construction machinery and aircraft. The Commerce Department said Tuesday that factory orders dropped by 1.2 percent to a seasonally adjusted $406.4 billion. Analysts expected a much smaller drop. May's decline was revised to a steeper decrease of 1.8 percent. It was initially reported as a 1.4 percent drop. The two months of declines follow nine straight month of increases, as manufacturers ramped up production last fall and helped the U.S. economy grow after four quarters of contraction. ___ Stocks fall after weak earnings, economic reports NEW YORK (AP) â¿¿ The stock market put its big rally on hold Tuesday after disappointing earnings and economic reports reminded investors of the obstacles still facing the economy. The Dow Jones industrial average fell 38 points after rising 208 Monday on brighter economic news. All the major indexes fell moderately. Investors were unhappy with just about every major earnings or economic report Tuesday. The stream of bad news was a reminder that the recovery is going to be bumpy and slow.
___US auto sales rise, helped by credit, promotions DETROIT (AP) â¿¿ Automakers posted higher U.S. sales last month, a sign that Americans are still willing to buy big-ticket items even though concerns linger about the economy and hiring. After a sluggish June, sales rose slightly for General Motors Co. and Chrysler. Foreign-based companies such as Toyota and Honda posted bigger gains. Ford, meanwhile, had flat sales. Sales were boosted by easier credit and new versions of cars and trucks ranging from Jeeps to large family wagons. Summer promotions also helped. ___ Pending home sales sink 2.6 percent in June WASHINGTON (AP) â¿¿ The number of buyers who signed contracts to purchase homes dropped in June, as the weak economy and tight lending standards kept consumers away from the housing market. The National Association of Realtors said Tuesday that its seasonally adjusted index of sales agreements for previously occupied homes dipped 2.6 percent to a reading of 75.7. That was the lowest on records dating back to 2001 and down nearly 19 percent from the same month a year earlier. The index has fallen more than 40 percent from its peak in April 2005. May's reading was revised slightly downward to 77.7. ___ P&G 4Q profit falls short after big ad spend CINCINNATI (AP) â¿¿ Procter & Gamble Co. is betting that heavy advertising will draw budget-conscious households to new products, even those with higher prices, as it tries to build sales and market share in a tough economy. The consumer products maker reported Tuesday that net income fell 12 percent in its fourth quarter, largely because of company-record spending on marketing. Revenue rose 5 percent, and the company expects continued growth over the next year. Smaller rival Clorox Co. also said more spending on promotions, and tough competition, took a bite out of fourth-quarter results. The maker of its namesake bleach and Glad trash bags said net income was nearly flat, even though revenue was up 1 percent.
___Dow turns profit, but not enough for Wall Street NEW YORK (AP) â¿¿ Wall Street is wondering if Dow Chemical Co. has been too optimistic in its profit forecasts after second-quarter results fell short of expectations. The nation's largest chemical maker said Tuesday that increased demand and higher prices for chemicals used in products ranging from consumer electronics to adhesives helped it swing to a profit from a year-ago loss. But the results fell below the expectations of analysts. Dow Chemical shares dropped 9.2 percent to $25.72. S&P Equity Research cut its 12-month price target for Dow to $30 from $34 after the results were released. ___ Drugmaker Pfizer posts 9 percent jump in 2Q profit Pfizer Inc. on Tuesday reported a 9 percent rise in second-quarter profit, trouncing Wall Street expectations as revenue jumped 58 percent due to favorable currency rates and its mega-acquisition of fellow drugmaker Wyeth last October. Shares jumped 5 percent on the surprisingly strong report. The maker of cholesterol blockbuster Lipitor and impotence pill Viagra said net income for the three months ended July 4 rose to $2.48 billion, or 31 cents per share. A year ago, income was $2.26 billion, or 34 cents a share. Pfizer has since sold millions of new shares to help pay for Wyeth. ___ Barnes & Noble may put itself up for sale NEW YORK (AP) â¿¿ Book retailer Barnes & Noble Inc. said its shares have slumped so low it may put itself on the block â¿¿ possibly selling the chain to an investment group that would include its founder and biggest shareholder, Leonard Riggio. The world's largest bookseller said late Tuesday that its board is evaluating several options to boost shareholder value in the face of a depressed stock price, including selling the company. Riggio, who holds some 28 percent of the company, said he's considering joining an investor group to buy the retailer.
___New BlackBerry is badly needed flagship for RIM NEW YORK (AP) â¿¿ Research In Motion Ltd., the maker of the BlackBerry, revealed a new phone Tuesday that says the company is still in the game, but it's doing so by catching up to the competition rather than by breaking new ground. The Torch will be RIM's first device with both a touch screen and the BlackBerry's signature full-alphabet keypad. It hits AT&T stores on Aug. 12 for $199 with a two-year contract. Meanwhile, RIM is scrambling to deal with suspicion from foreign governments threatened by the very thing that's made the phones such a success in the corporate market â¿¿ the assurance that a user's e-mail is private. By The Associated Press The Dow fell 38.00, or 0.4 percent, to 10,636.38. The Standard & Poor's 500 index fell 5.40, or 0.5 percent, to 1,120.46, while the Nasdaq composite index fell 11.84, or 0.5 percent, to 2,283.52. Benchmark crude for September delivery gained $1.21, or 1.5 percent, to settle at $82.55 a barrel on the New York Mercantile Exchange as traders instead took their cue from a weaker dollar. In other Nymex trading in September contracts, heating oil rose 4.62 cents to $2.2000 a gallon, gasoline added 2.5 cents to $2.1935 a gallon while natural gas fell 6.2 cents to 4.639 per 1,000 cubic feet. In London, Brent crude settled up $1.86 at $82.68 a barrel on the ICE Futures exchange.